Asian Stocks Pare Weekly Gain as Tokyo Shares Drop After Quake

(Bloomberg) -- Asian stocks pared their biggest weekly advance in a month as health-care companies led losses and an earthquake in western Japan weighed on Tokyo equities. Hong Kong markets were shut due to a typhoon.

The MSCI Asia Pacific Index fell 0.3 percent to 139.70 as of 3:03 p.m. in Hong Kong, halting a three-day gain. Japan’s Topix index slid 0.4 percent from a May high, paced by a slump in Nintendo Co. The quake, which struck Tottori prefecture, led to power outages and halted bullet trains. Hong Kong canceled stock trading for the day as Typhoon Haima lashed the global financial center, prompting schools to close and airlines to suspend flights.

The Asian equity measure has climbed 1.1 percent this week as data indicated Chinese economic growth is stabilizing. As investors brace for higher U.S. borrowing costs before the end of the year and a presidential election next month, companies from Microsoft Corp. to Keppel Corp. in Singapore are updating shareholders on profit performance. Odds the Federal Reserve will boost interest rates by December have risen by about two percentage points over the past week, to 68 percent, according to Fed funds futures tracked by Bloomberg.

“If you’ve been well invested over the last several years and you’ve made some big gains, it’s sensible to bank some of those and have a neutral to defensive position,” Mark Lister, head of private wealth research at Craigs Investment Partners in Wellington, which manages about $7.2 billion, said by phone. “But unless something comes out of left field, the Fed will hike in December and that means the economy is on a solid footing and that’s positive.”

Earnings season in the U.S. and Europe has so far been a mixed bag, with lackluster profit forecasts from Nestle SA and EBay Inc., while American Express Co. and Deutsche Lufthansa AG had better-than-expected projections on Thursday.

Healthscope Ltd. chalked the biggest decline on the MSCI Asia Pacific Index, tumbling 19 percent. Australia’s second-largest private-hospital operator said that first-quarter revenue growth at its unit was slower than expected.

Keppel was set for its biggest loss in more than a month after the world’s biggest oil-rig builder announced a drop in profit and more job cuts. Aluminum Corp. of China Ltd., the country’s second-largest producer, rose 0.8 percent in Shanghai after saying it swung to a profit in the third quarter.

Hong Kong Exchanges & Clearing Ltd., operator of the equity market, said it scrapped trading for the day as storm signal No. 8 remains in force. Authorities shut schools, and most of the city’s ferry and bus services have been suspended. Trains continue to operate with an adjusted schedule, MTR Corp. said in a statement.

Australia’s S&P/ASX 200 Index lost 0.3 percent and Singapore’s Straits Times Index fell 0.5 percent. South Korea’s Kospi index retreated 0.4 percent and the Philippine Stock Exchange Index slipped 0.7 percent. Thailand’s SET Index gained 0.3 percent and the Shanghai Composite Index added 0.2 percent.

Japan Quake

The Topix extended declines after the quake, which rattled some traders ahead of the weekend. Japan’s public broadcaster NHK reported that several were injured where shaking was among the strongest, but local media have not yet reported any deaths.

With more than 350 companies on the Topix scheduled to release their quarterly results next week, investors are looking for signs of how much this year’s stronger yen is impacting profits. The Topix is down 12 percent in 2016 with the yen 16 percent higher against the dollar.

Nintendo Disappointment

Nintendo sank 6.6 percent. The long-awaited gaming platform Switch, featuring a tablet-like console that will let gamers play at home and on the go, was unveiled in a three-minute video released late Thursday. The Kyoto, Japan-based company showed gamers using the new system to play in their living rooms, but also detaching a part of it to continue playing at an airport, in a car and at a barbecue.

“It’s a disappointing console,” said Amir Anvarzadeh, Singapore-based head of Japanese equity sales at BGC Partners Inc. “It doesn’t enhance the gaming experience when you have a smartphone in your pocket.”

Futures on the S&P 500 Index slid 0.2 percent after the underlying gauge retreated 0.1 percent on Thursday. Microsoft surged as much as 5.8 percent in after-hours trading after first-quarter sales and earnings topped analysts’ estimates, buoyed by growing demand for cloud-based software and services.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net. To contact the editors responsible for this story: Jeff Sutherland at jsutherlan13@bloomberg.net, Chan Tien Hin, Anna Kitanaka

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